BANKING ECOSYSTEMS
For Pattni , the key to maximising revenue from an ecosystem harks back to open banking ’ s core tenet : ecosystems are largely driven by customer expectations .
He says : “ Big techs are constantly enhancing the richness of their platforms , integrating multiple payment options . People have gotten used to that level of service and are now expecting that from their financial service providers across the board , whether it ’ s for offering loans or mortgage products .”
The adaptability and rate of evolution at big tech firms can be attained by “ the ecosystem play ”, according to Allum , “ which allows banks to adapt to a changing financial system as the margins from traditional products like payments shrink .”
The slow migration of banks joining ecosystems – despite their willingness – has led to suggestions that big tech firms , which already have a foothold in digital payments ( Apple Pay and Google Pay for example ), could look to capitalise on this and launch their own banking services .
Despite these claims , banking is not something Fernando thinks will interest big tech firms . She says : “ It is important to consider that big tech makes more revenue from banks through its advertising , media and cloud services . In many cases , big tech firms generate more significant revenues by partnering with or providing services to big banks rather than directly becoming banks themselves .”
This view is shared by BlueSnap ’ s EU CEO and VP of Product , Bryan Gaynor , who believes tech firms will be put off by the amount of “ glue needed to manage regulations and cash-in accounts ”, something which banking infrastructures are traditionally built to accommodate . Tech companies are used to “ moving significantly faster with their agile infrastructures ”, Gaynor adds .
54 August 2023